Comments on OECD Discussion Draft on the Revised Guidance on Profit Splits

Fri Sep 15 00:00:00 EDT 2017
Emmanuel Llinares, Harlow Higinbotham, Nihan Mert-Beydilli, and Vladimir Starkov

In an OECD Discussion Draft on the Revised Guidance on Profit Splits, NERA Transfer Pricing experts Dr. Harlow Higinbotham, Dr. Emmanuel Llinares, Nihan Mert-Beydilli, and Dr. Vladmir Starkov, suggest that non-prescriptive guideline on the profit split method is the only way to ensure a sustainable interpretation of the arm’s length principle in a complex area such as profit splits. In other words, the guidance needs to be clear on the principles and careful in their wording and application, and step away from implementation details, which are driven by the specific circumstances of each individual case.